May 12, 2014

Webrooming Nonsense

Look at the heading for the "Top Story":

That'll get page views, which means the folks at Shop.org get paid by the folks at Kronos.Of course, we want customers to "webroom" ... within our "brand". Right? Right??Ten years ago at Nordstrom, my team proved that "webrooming" was a very, very good thing. Ten years ago! Those folks were way, way ahead of the curve.At Nordstrom, customers visited the website 3 times a month, they visited the store 2 times a month, and they bought 1 time a month, with 85% of the purchases in-store.In other words, our customers were "webrooming" all the time ... every 10 days, in fact (and we'd be naive to think they weren't webrooming with Neiman Marcus and Macy's and Banana Republic and dozens of other businesses ... that's life). These customers seldom converted online - they researched online, then bought in the store.Webrooming is not a problem. Webrooming is exactly what you want. You want a customer who loves your business so much that they visit your site all the time ... you simply don't care if the customer visits 20 times between purchases, as long as the customer purchases something!

In a recent project, I learned that each unconverted website visit (in the past 30 days) increased the odds of a customer buying from the website next month by 10%, and in stores by 4%.Each visit.What if the customer visited four times last month, and did not purchase?

A 40% increase in direct channel buying probability next month.

A 16% increase in in-store buying probability next month.

Webrooming! It's a good thing!

I think we're measuring things wrong. We have customers, customers who are at different stages of a relationship. By measuring engagement (page views) and by measuring conversion optimization, we miss a larger truth about customer behavior.On and off, over the next two months, I'm going to present a segmentation strategy that illustrates that unconverted website visits are simply part of the customer relationship. There's a reason that mobile converts poorly. There's a reason customers visit the website then buy in a store. There is a reason why email marketing appeals to a small fraction of the customer base, enabling you to save a fortune in other marketing expenses across the email buyer file. We're going to learn that we don't care if a customer visits the website 10 times and then buys 1 time in a store.In other words, we're going to learn to re-evaluate our metrics surrounding conversion "success". Come along for the journey!

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Kevin Hillstrom, President, MineThatData

Kevin is President of MineThatData, a consultancy that helps CEOs understand the complex relationship between Customers, Advertising, Products, Brands, and Channels. Kevin supports a diverse set of clients, including internet startups, thirty million dollar catalog merchants, international brands, and billion dollar multichannel retailers. Kevin is frequently quoted in the mainstream media, including the New York Times, Boston Globe, and Forbes Magazine.

Prior to founding MineThatData, Kevin held various roles at leading multichannel brands, including Vice President of Database Marketing at Nordstrom, Director of Circulation at Eddie Bauer, and Manager of Analytical Services at Lands' End.

You may contact kevin at kevinh@minethatdata.com.

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